Principles of Microeconomics / Unit 1 MIC 0017 short lesson, about 20 seconds
The Budget Constraint
Captions available
The idea
A budget constraint shows every combination of two goods a person can buy when all income is spent at given prices; its slope is the price ratio.
In practice
Points on or inside the line are affordable; points outside are not.
Where people slip
The line is straight because prices do not change with the quantity bought; the frontier in video twenty-three will not be.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
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